Are You Overspending on IT? How to Find Out and Cut Costs


IT costs are often one of the more expensive parts of a business’s budget. Cutting these costs can be hard when there are other priorities and fixed prices. Personnel costs are often the main expense, although there are other costs that can be reduced as well. 

Replace Turnover With Lower Level Employees

An easy way to keep your organization in line is to set the expectation that all replacements be one level lower than the person who leaves. Of course, this is not always possible, so you ought to have an exception process to deal with these circumstances. 

Virtualize Servers By Using Containers

It used to be the case that every application needed a dedicated server, and this multiplied due to DR servers, test servers, and more. A lot of these servers had a low-utilization rate, so hardware costs weren’t optimized. 

If you’re still using dedicated servers, you can save money by partitioning them to let multiple applications share the same hardware. On the same line, containers are a good option too. Linux containers are self-contained runtime environments that are both lightweight and portable. Services can be run on the same box, so hardware costs are lowered. 

Hire New College Graduates Every Year

If you know that your company will hire a certain amount of new graduates, then you can plan for this when you have attrition. Find a nearby college that you like and work to build a relationship with their placement office. You can recruit through them consistently. Taking on interns can also be a good way to find potential talent that will be cheaper to hire.

Manage Your Contractors

Sometimes, contractor costs can get out of control as they are viewed as a separate cost to employee and retainment costs. Some businesses might use a higher-priced contractor than they really need, due to believing that it will give them flexibility if the conditions of the business change. This is true, but managers shouldn’t underestimate how hard it can be to eliminate contractors who have the specific skills that are needed. 

Make sure your company is paying attention to the expense that comes with contractors by publishing a count of how many contractors you have, what you pay them, and how much overtime they’re working. This visibility can encourage better management of your contractor costs. 

Use Cheaper Hardware

As well as maximizing the way you use your hardware using containers, you could also run your applications on cheaper devices. This strategy became very popular, and viable, a few years ago, when powerful PCs were created that could be linked together and perform just as well as more expensive mid-range servers. 

Use The Cloud

You don’t need storage and hardware on-site anymore, and the cost of renting can be a lot lower than the cost of owning, as you only use resources when they’re needed. Containers can be useful here too, as they will allow customers to shop for the best price from cloud providers. 

Outsource Your IT

Ultimately, the most cost effective way to manage your IT is to outsource it to a managed service provider. This way, all you need to allocate for IT services is one flat monthly cost. This cuts costs for IT department salaries and emergency break-fix fees and downtime. Consider outsourcing to a local IT company in St. Louis for these benefits.